As I was using my Power Stocks scanning program to take a look at the market, food stocks caught my attention. Several names in this area had all of the qualities I look for in a call option—the potential for a big move up (volatility) based on technicals and past activity in the stock, and good liquidity. All of these are names you’ll recognize, and for good reason—options which do not have liquidity may trap you into a position, or prevent you from taking a large enough position to make the transaction worthwhile.
I’ll leave it up to you to decide which strike price and month are appropriate for your trading style, but be sure to give yourself enough time to be right. I’ve also included the support and volatility levels my scanner has detected for these stocks. An average volatility is considered to be 20.
- Chiquita Brands (CQB) is currently trading around $11, a healthy level above support at $9. It’s in a “reestablished buy” price pattern in which it has resumed its bullish trend after a temporary slowdown. Volatility is very high though, rated 55.
- Krispy Kreme (KKD) is a powerhouse stock, one of the strongest I currently follow. It has support at $15 and is currently trading at $17.23, with very high volatility at 53.
- Starbucks (SBUX) has already started its ascent, currently trading around $66.35, which is well above support at $62. The stock has relatively mild volatility, with a rating of 18, so I wouldn’t expect any wild swings.
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